Question :
51)
If joint products end up with the same gross margin : 1196108
51)
If joint products end up with the same gross margin percentage, which of the following is TRUE?
51)
______ A)
The gross margin percentage NRV method must have been used. B)
The estimated net-realizable method must have been used. C)
If all products are sold at the split off point, and there were no opening inventories, the sales value at split off method could have been used. D)
The cost allocation method assigned the same cost per unit to each product. E)
The physical measure method must have been used.
52)
Which of the following is FALSE concerning the physical measure method? 52)
______ A)
Using the benefits-received criterion, the physical measure method less preferred than the sales at split off method. B)
Using a common physical measure can result in the product with the lowest revenue-producing power having the most costs assigned to it. C)
Technical personnel outside of accounting may be required in the joint costing determinations. D)
The physical measure may not reflect each individual product’s ability to generate revenues. E)
It results in a constant gross margin for all products.
53)
What is product X’s approximate gross margin percentage using the physical volume method? 53)
______ A)
32% B)
33% C)
38% D)
35% E)
30%
54)
The estimated net realizable method allocates joint costs on the basis of 54)
______ A)
value added after the split off point. B)
sales value less value added after the split off point. C)
relative numbers of physical units of each product. D)
expected final sales value less separable costs of production and marketing. E)
revenue less all direct manufacturing costs after split off point.
Use the information below to answer the following question(s).
Beverage Drink Company processes direct materials up to the split off point, where two products, A and B, are obtained. The following information was collected for the month of July:
Direct materials processed: 2,500 litres (with 20 percent shrinkage)
Production:A1,500 litres
B500 litres
Sales:A$15.00 per litre
B$10.00 per litre
Cost of purchasing 2,500 litres of direct materials and processing it up to the split off point to yield a total of 2,000 litres of good products was $4,500. There were no inventory balances of A and B.
Product A may be processed further to yield 1,375 litres of Product Z5 for an additional processing cost of $150. Product Z5 is sold for $25.00 per litre. There was no beginning inventory and ending inventory was 125 litres.
Product B may be processed further to yield 375 litres of Product W3 for an additional processing cost of $275. Product W3 is sold for $30.00 per litre. There was no beginning inventory and ending inventory was 25 litres.
55)
What are the expected final sales values of production if Product Z5 and Product W3 are produced? 55)
______ A)
$11,250 and $34,375 B)
$31,250 and $10,500 C)
$22,500 and $5,000 D)
$34,375 and $11,250 E)
$34,375 and $10,500
56)
Which of the following methods allocates joint costs according to the appraised final sales value in the ordinary course of business less the appraised separable costs of production and marketing? 56)
______ A)
physical measure method B)
sales value at split off method C)
constant gross-margin percentage NRV method D)
split off appraisal method E)
estimated net-realizable method
Use the information below to answer the following question(s).
Beverage Drink Company processes direct materials up to the split off point, where two products, A and B, are obtained. The following information was collected for the month of July:
Direct materials processed: 2,500 litres (with 20 percent shrinkage)
Production:A1,500 litres
B500 litres
Sales:A$15.00 per litre
B$10.00 per litre
Cost of purchasing 2,500 litres of direct materials and processing it up to the split off point to yield a total of 2,000 litres of good products was $4,500. There were no inventory balances of A and B.
Product A may be processed further to yield 1,375 litres of Product Z5 for an additional processing cost of $150. Product Z5 is sold for $25.00 per litre. There was no beginning inventory and ending inventory was 125 litres.
Product B may be processed further to yield 375 litres of Product W3 for an additional processing cost of $275. Product W3 is sold for $30.00 per litre. There was no beginning inventory and ending inventory was 25 litres.
57)
What is Product Z5’s estimated net realizable value at the split off point? 57)
______ A)
$22,350 B)
$34,525 C)
$34,225 D)
$34,375 E)
$11,100
58)
What is Product B’s estimated sales value at the split off point? 58)
______ A)
$5,000 B)
$3,750 C)
$8,250 D)
$4,500 E)
$3,500
59)
Which of the following methods calculates expected profits before any costs are allocated? 59)
______ A)
sales value at split off method B)
physical measure method C)
estimated net-realizable method D)
constant gross margin percentage NRV method E)
expected profits method
60)
All of the following statements about the constant gross margin percentage net-realizable method are true EXCEPT 60)
______ A)
the gross margin percentage remains the same regardless of the different amounts of separable costs. B)
all products have equal gross margin percentages. C)
the gross margin is calculated by deducting all separable costs from revenue. D)
some products may receive negative allocations of joint costs. E)
it is based on a tenuous underlying assumption.
Use the information below to answer the following question(s).
Beverage Drink Company processes direct materials up to the split off point, where two products, A and B, are obtained. The following information was collected for the month of July:
Direct materials processed: 2,500 litres (with 20 percent shrinkage)
Production:A1,500 litres
B500 litres
Sales:A$15.00 per litre
B$10.00 per litre
Cost of purchasing 2,500 litres of direct materials and processing it up to the split off point to yield a total of 2,000 litres of good products was $4,500. There were no inventory balances of A and B.
Product A may be processed further to yield 1,375 litres of Product Z5 for an additional processing cost of $150. Product Z5 is sold for $25.00 per litre. There was no beginning inventory and ending inventory was 125 litres.
Product B may be processed further to yield 375 litres of Product W3 for an additional processing cost of $275. Product W3 is sold for $30.00 per litre. There was no beginning inventory and ending inventory was 25 litres.
51)
C 52)
E 53)
A 54)
D 55)
D 56)
E 57)
C 58)
A 59)
D 60)
C
